SYSTEMIC RISKS
Fraud tag on loans only after hearing borrowers: RBI to banks
The RBI has mandated banks to give borrowers three weeks to respond before labeling accounts as fraudulent, aligning with a Supreme Court ruling on natural justice. Banks must issue detailed notices and consider responses before final classification, ensuring transparency. Boards must review fraud risk policies every three years, with a committee overseeing cases chaired by an independent director. Auditors are to investigate flagged accounts promptly, aiding in fraud detection. These measures aim to strengthen banking integrity and safeguard against financial misconduct.
RBI issues new circular, says lenders must hear loan defaulters before declaring accounts 'fraud'
The Reserve Bank of India has directed banks to provide defaulting borrowers with a minimum of 21 days to respond before classifying their accounts as "fraud." This follows a Supreme Court ruling mandating that banks cannot declare an account as fraudulent without issuing a show-cause notice and allowing the borrower a chance to respond.
New RBI credit card rule: Check if your credit card issuer bank is live on BBPS platform; full list of Bharat Bill Payment System billers
New RBI credit card rule:Bharat BillPay is a unified ecosystem that links banks and non-banks in the bill aggregation industry, as well as billers, payment service providers, and retail bill outlets. Below is a list of credit card billers currently active on BBPS as of July 15, 2024.
Kotak Mahindra Bank says it has to do more to leverage technology
Kotak Mahindra Bank's new chief emphasizes tech transformation despite RBI ban. Auditors highlight IT system complexities affecting financial reporting. Industry experts link RBI actions to the bank's 811 offering success. The bank shows growth in customer base and financial metrics.
Be bullish, just manage risks & desire; 5 midcap stocks for long term investors
In a bullish market many things change and one of them is the relationship between opportunity and challenges. Given the way markets are panning out, yes there are opportunities to make returns in a short term. But the challenge is finding the right stock which not only delivers a return in the short term but is also worth holding in the portfolio for the long term. This challenge emerges from the fact that valuations are at a higher level and a small negative news can damage prices much more and time wise correction can lead to returns turning much lower. So, there are two things which need to be managed, first avoid the risk of getting into wrong stocks and second is manage the desire of making all the returns in the short term.
Navigating climate risks: India's financial sector gears up for transparency with RBI's draft guidelines
The introduction of the disclosure framework is a laudable first step, signalling a concerted effort towards addressing climate risks and fostering climate action within the financial sector.
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Central spending gives a boost to liquidity, brings overnight rate 10 bps below repo
Following recent elections, increased government spending has injected liquidity into India's banking system, resulting in lower overnight borrowing rates, Treasury Bill yields, and short-term financing costs for Indian companies. Despite these developments, the Reserve Bank of India (RBI) appears cautious about reducing policy rates. The overnight weighted average call rate (WACR), which hovered above the RBI's repo rate of 6.50% in May and June, has averaged 6.39% in July, indicating a surplus liquidity situation.
Germany to phase out China's Huawei and ZTE components from its 5G network
Germany's Interior Minister Nancy Faeser said, "In this way, we are protecting the central nervous systems of Germany as a business location -- and we are protecting the communication of citizens, companies, and the state."
Options trading: How to protect investors and take care of market liquidity? Deepak Shenoy answers
Increasing the lot size for options trading would probably make sure that there will be people who will have to put a little more money to play in, slightly more capitalised. In an extreme leverage situation, people need capital to cover extreme events and that retail participants may not have, says Deepak Shenoy
Understanding Smart Contracts: The backbone of secure transactions in DeFi
This article explores DeFi and Ethereum-based smart contracts introduced by Nick Szabo, streamlining lending platforms, DEXs like Uniswap, and tokenized assets. Key features include atomic settlements and composability. Despite efficiencies, risks like the Poly Network hack necessitate security audits. Future advancements involve self-custody, AI integration, and interoperability in structured products.
Not as $trong, but $till $ignificant
Recent reports suggest that Saudi Arabia has shifted away from the US dollar in its oil trade agreements, deviating from the petrodollar system. Though these reports lack concrete evidence, they stir speculation in the global financial system. BRICS nations have also signaled intentions to reduce their dependence on the dollar, advocating the use of local currencies in cross-border transactions among member states.
Oil prices edge higher as supply risks mount
Oil prices responded to geopolitical tensions and supply disruptions, with concerns over fuel demand dynamics. The market saw gains in Brent and WTI futures amidst heightened uncertainties, while attention remained on the impact of geopolitical conflicts on oil supply. Anticipation of increased gasoline consumption over the July 4th weekend offered some relief amid persisting demand challenges.
Sebi warns of rising risks from derivative trading frenzy
India's market regulator on Thursday warned of rising risks from a surge in derivative trading volumes, with small investors jumping in to trade risky options contracts.
RBI expresses concern over credit growth, says expansion of above 18% may create risk
Retail lending growth slows in Q4 FY24, while bank lending to NBFCs moderates. The share of bank lending to NBFCs decreases, indicating a shift towards balanced credit practices for financial stability.
RBI cautions against surge in private credit between corporates and non-banks
The Reserve Bank of India (RBI) warns of systemic risks from the rapid growth of private credit, which has quadrupled in the past decade, especially due to its opacity and interconnectedness with banks and non-banks. The RBI highlights potential vulnerabilities in this segment, including the risk of sharp losses during a credit cycle downturn and challenges posed by complex structures and liquidity risks.
RBI flags pursuit of growth at cost of risk buildup
India's banking regulator cautioned lenders against pursuing 'mindless' business growth to avoid exposing the financial system to risks. RBI Governor Shaktikanta Das emphasized the importance of balancing business growth with risk management.
PSBs lean less on OIS as a hedgeon uncertain local rate outlook
State-owned banks are reducing their reliance on derivatives to hedge domestic interest rate risks, with a notable decline in the market share of nationalised banks in the IRS MIBOR segment. Factors such as liquidity deficits, market volatility, and inflation targets have influenced this trend.
Sebi forms committee to review ownership, economic structure of clearing corporations
Sebi forms committee chaired by Usha Thorat to review ownership and economic structure of clearing corporations for resilience and neutrality.
Risk weighting slows unsecured loan growth
The growth of unsecured credit in India, including personal loans and credit card outstanding, slowed to 18% in April from 23% in November 2023. The Reserve Bank of India's risk weighting on such exposures aims to reduce delinquencies in the banking system.
Weekly Top Picks: These stocks scored 10 on 10 on Stock Reports Plus
Stock Reports Plus, powered by Refinitiv, undertakes detailed company analysis for 4,000+ listed stocks. In addition to detailed company analysis, the report also collates analysts’ forecasts and trend analysis for each component. An average score in Stock Reports Plus is calculated by undertaking quantitative analysis of five key investment tools - earnings, fundamentals, relative valuation, risk and price momentum.
Some Indian ARCs are circumventing rules, says RBI's Swaminathan
RBI Deputy Governor Swaminathan J. disclosed in a recent speech that some Indian Asset Reconstruction Companies (ARCs) have been skirting regulations, aiding in the "evergreening" of distressed assets. The RBI has ramped up supervision to curb systemic risks and ensure compliance. Swaminathan urged ARC boards to prioritize assurance functions like risk management and internal audit to identify and mitigate risks effectively.
Weekly Midcap Top Picks: These midcap stocks scored 10 on 10 on SR plus.
Stock Reports Plus, powered by Refinitiv, undertakes detailed company analysis for 4,000+ listed stocks. In addition to detailed company analysis, the report also collates analysts’ forecasts and trend analysis for each component. An average score in Stock Reports Plus is calculated by undertaking quantitative analysis of five key investment tools - earnings, fundamentals, relative valuation, risk and price momentum.
Banks' credit growth in FY25 to slow down to 14% on lower GDP uptick, RBI measures: Crisil
Crisil forecasts a 2 percentage point drop in the banking system's credit growth to 14% for the fiscal year 2024-25, citing factors such as lower GDP growth, RBI measures like higher risk weights on unsecured loans, and a high base effect. Slower deposit growth is expected to temper credit expansion, though the fundamental drivers of credit demand remain intact. While corporate segment growth is projected to maintain at 13%, retail growth will slow to 16%.
Weekly Top Picks: These stocks scored 10 on 10 on Stock Reports Plus
Stock Reports Plus, powered by Refinitiv, undertakes detailed company analysis for 4,000+ listed stocks. In addition to detailed company analysis, the report also collates analysts’ forecasts and trend analysis for each component. An average score in Stock Reports Plus is calculated by undertaking quantitative analysis of five key investment tools - earnings, fundamentals, relative valuation, risk and price momentum.
Top Nifty50 stocks analysts suggest buying this week
The latest Stock Reports Plus report dated May 26, 2024, highlighted stocks in the Nifty50 index with 'Strong Buy/Buy' recommendations. Analysts use IBES for actionable insights. Stock Reports Plus, powered by Refinitiv, evaluates 4,000+ listed stocks on five key components to generate scores.
Harvard-led research reveals: Extreme temperatures linked to stroke deaths
Recent studies, including one led by Harvard University, have linked extreme temperatures, both hot and cold, with increased risks of stroke-related deaths. The research, analyzing data from 522 cities across 25 countries over several decades, found a stronger association between extreme temperatures and stroke deaths in low-income countries. Specifically, extreme cold and hot days were found to contribute to a significant number of ischaemic and haemorrhagic stroke deaths.
Trading journal is the most underrated risk mitigation technique. Here’s a 5-step guide
The trading journal is an indispensable for enhancing trading skills. It helps to systematically record all trades that enables us to identify the strengths and weaknesses, analyze trades, and create a profitable strategy. Finance Minister Nirmala Sitharaman emphasized the benefits of using a trading journal to enhance trading skills and profitability, highlighting the importance of stability in the financial market to protect investors.
Top Nifty50 stocks analysts suggest buying this week
Stock Reports Plus, powered by Refinitiv, is a comprehensive research report that evaluates five key components of 4,000+ listed stocks - earnings, fundamentals, relative valuation, risk and price momentum to generate standardized scores.
Pornhub, XVideos, Stripchat face strict EU rules, Commission says
Pornhub, Stripchat, XVideos must adhere to new EU online content rules by April 21 (Stripchat by April 23) under the Digital Services Act, including risk assessment reports, systemic risk mitigation, transparency obligations, and potential fines up to 6% of global turnover.
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